Saraf: put fiscal stimulus in operation
The Federation of Indian Export Organizations (FIEO) has urged banks to ensure that the latest repo rate cut by RBI are adequately reflected in the lending rates, to encourage private investment and consumer loans get a push to help various segments of economy.
Making this call, FIEO President Sharad Kumar Saraf hoped that the reduction in credit rates will further encourage investment both by the domestic companies as well as by FDIs since corporate tax rate in India is now amongst the best in the world.
Saraf welcomed RBI’s repo rate cuts to support fiscal stimulus, encourage investment, boost consumer sentiments and demand.
RBI has cut benchmark interest rates for the fifth time to support other fiscal measures announced by the Government to boost growth.
It reduced the lending rate by 25 basis points to 5.15%, which takes cumulative cuts so far this year to 135 bps.
RBI has rightly acknowledged the challenges faced by the global economy as both advanced as well as emerging markets are showing weakening demand and contracted manufacturing, he noted.
WTO has already significantly cut its forecast for the global trade growth to 1.2% for 2019. The challenges in exports will continue and may aggravate with geo-political situation.
Saraf has also urged the Government to ensure that various fiscal stimulus announced by the Government are put into operation so that the benefit flows down to the industry. fiinews.com